‘Pension Smoothing,’ the Highway Trust Fund’s Temporary Friend

The 10-month Highway Trust Fund bill that the House passed last week is hardly the first piece of legislation that features a mishmash of pay-for provisions intended to keep it from increasing the deficit. This time around, one of the primary revenue-raisers ($6.4 billion worth) is a “pension smoothing” provision.

Never heard of that accounting maneuver? CQ Roll Call’s Emma Dumain and David Harrison explain it this way:

[Pension smoothing] lets companies with defined benefit retirement plans assume higher interest rates when calculating how much money they need to contribute for their employees’ retirement. That reduces their required contributions into the plans and, in turn, raises the amount of taxes they owe, bringing new revenue to the federal government.

That’s over the short term. “But over the long-term, companies will be on the hook to contribute more to their pension funds, lowering tax revenue,” writes Alex Rogers of Time magazine in a useful explainer on pension smoothing. “It’s no one’s ideal revenue raiser,” Rogers says.

The 10-month bill is expected on the Senate floor as early as next week.

Both political parties have long forgotten about the more than three million unemployed families still without unemployment benefits since late last December. Over the past seven months, these families have fallen deeper and deeper into financial ruin and poverty. Both parties seem to lack the compassion to even care. While the republicans have fought tooth & nail on behalf of their constituent the Koch brothers, they continued to ignore the poor & unemployed. Congress has approved billions of dollars for the Ukraine, but lacks the moral fiber to help our own people in this country. These families are not going away, they are still in desperate need of a retro extension bill to help them recover from this economic catastrophe. Where are the “family values” which the republicans represent themselves as having??

Heather Sharp

Yea, the Koch brothers are responsible for people who don’t want to take available jobs. Time for these people to change their line of work don’t ya think?

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About The Container

The Container covers the transportation community in Washington.

Tom Curry (@TCurry_Himself) writes for The Container. He has been a national affairs reporter and editor for nearly two decades, having covered elections, Supreme Court nominations, fiscal policy and the health care debate.